Despite the frequently cited idea that CFOs are becoming more strategic, the recently conducted ‘Future of the Finance Function’ survey found that in many cases, CFOs are ‘treading water,’ and spending too much time on things like transaction processing, management accounting and statutory reporting.
Spending too much time on basic accounting tasks means CFOs have less time to spend on innovation, process improvement, strategy development and business partnering. In fact, the survey showed that 68% of respondents say they don’t have time for these critical strategic tasks. In addition to underserving these important strategic functions, CFOs are missing out on valuable insights due to the lack of centralized, timely information.
This tension between the strategic and the tactical is often more pronounced in businesses that launch new products or engage in new contracts at pace. The CFO is often unable to strategically advise on profitability, link return to risk or forecast the balance sheet and impact to key rations. The telecommunications industry is a good example of where finance are often unable to model big decisions impacting product or pricing due to data and time constraints.
In order to drive more business insight, automation and standardization are essential. New technology systems can free up time for CFOs to transition properly into their much-hyped role. Decreasing the amount of time spent on basic accounting gives finance the opportunity to strategically analyze and advise on key decision-making and be more actively involved in strategy development.
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